Vehicles

Bus Shopping 101: Six Basics To Get Started

To survive the economic climate of the Great Recession, chauffeured transportation operators have adapted to new client demands and market opportunities by adding motorcoaches to their fleets. This evolution has allowed the industry to pursue business from sectors once underserved by chauffeured transportation. Group transportation and the bus market can be lucrative in the long-term, but the purchase of a bus is an expensive investment that comes at considerably higher risk than standard chauffeured vehicles.

To make things easier for you, LCT has garnered the following bus shopping tips from an expert panel at the 2012 International LCT Show in Las Vegas. The panel included Gary Bauer of Bauer’s Intelligent Transportation in San Francisco; Brent Bell of Bell Trans in Las Vegas; Chuck Covington of People’s Transit near Detroit; and John Ferrari of AFC Transportation in Houston.

The expert panel at the 2012 International LCT Show was moderated by Gary Bauer, president & CEO of Bauer’s Intelligent Transportation.

1. Know Your MarketplaceBefore buying a bus, it’s important for operators to know if their markets can sustain the business.

Figure out if the market is saturated or if there is room for another bus in town.

Determine if the demand for buses is consistent or seasonal.

Listen to clients and prospects to learn what types of buses they seek.

Look for underserved niche markets.

Research opportunities to provide transportation for government contracts, hotels, corporations, special events, destination management companies, universities, sports teams, and church groups.

Gary Bauer advises operators to build up their book of business through farm-out work until the amount of business can justify the purchase of a bus. “If [your bus] is not rolling seven, eight or nine times a week, then you’re doing something wrong,” he says. “Buses should be doing more work than other vehicles.”

2. New vs. Used VehiclesBuying a used bus initially may be cheaper than buying a new one, but it also can be a risky investment if they aren’t meticulously inspected and researched.

“Used buses can be really good deals,” Chuck Covington says. “Municipalities tend to get rid of their buses after about 12 years, and the Altoona testing is good for about 18 years. Sometimes the engines are replaced at 10 years.”

John Ferrari says he only buys new buses because he might be “inheriting someone else’s problems when buying a used one.”

Operators always should get the biggest and longest warranty available, whether the bus is new or used, because “it is worth its weight,” Bauer says.

Look closely at the warranty to see what parts are really covered, Ferrari says, because most warranties don’t cover turbochargers. And if those break and cause the engine to die, the warranty is null and void.

3. Type of Bus To BuyWith a variety of bus makes and models on the market, operators first should consider client needs and the opportunities in the market.

Survey clients on present and future needs.

Look for a bus that will fit multiple needs. Some buses offer hybrid seating options that can make a bus go from a forward-facing, charter/shuttle arrangement to limo seating.

A monocoque chassis offers more structural integrity than a body-on-chassis bus but costs more. Body-on-chassis buses are cheaper but best suited for short runs and are not as durable as a monocoque chassis.

Think of the average body size of your clientele and find a seating arrangement that will be roomy and comfortable.

When weighing out fuel choice options, remember that compressed natural gas (CNG) and propane can be more cost effective than traditional fossil fuels, but filling stations are harder to find.

If the coach is a limo bus, check to see that it has a rear luggage compartment.

Consider the regional climate and choose the color accordingly. Brent Bell, whose company operates in the Nevada desert, uses white buses because they stay cool.

Bell suggests starting out with smaller buses, such as the E-450, and working up to larger buses. “You can still be competitive with a motorcoach company if you’re efficiently running your minibuses.”

Operators should market their vehicles to let people know they have the equipment because that will open them up to more business opportunities, Ferrari says.

4. Onboard AmenitiesInterior features and additional equipment will depend upon the types of service an operator plans to use the bus for along with the demands and needs of the clientele.

The expert panel at the 2012 International LCT Show included Brent Bell, president & CEO of Bell Trans (left); Chuck Covington, CEO of People’s Transit (middle); and John Ferrari, owner of AFC Transportation (right).

Think about ADA (Americans with Disabilities Act) compliance. The ability to transport passengers in wheelchairs will open your company up to business opportunities from more sectors.

Three-point seatbelts are a good way to go, Ferrari says.

Wi-Fi has become a standard feature as more clients come to expect it.

Make sure the vehicle can pump out enough air conditioning to keep the bus cool in your geographic area.

“Don’t equip a minibus or shuttle with a restroom,” Ferrari says.

“Use rest stops,” Bell says.

5. Return On InvestmentThe bus market is lucrative, and the most important question to ask when getting into it is: Will I make money with this new vehicle? Here are some ways to make sure the answer is a solid “Yes.”

Know your costs, your price per hour, and your price per mile. Create a budget and expense model based on this information.

Have a strategy for every bus you buy and every market you enter. Make sure the strategy accounts for the long-term because the bus market is a long-term business.

“I will farm out bus work until I can do at least 25 days a month at five hours a day,” Ferrari says. “I’ll only add a bus once I know I can meet that minimum amount of work.”

Maximize bus business potential by having a corporate or charter coach transition to airport shuttle work when it reaches a certain age or mileage.

6. Risk Management/ Safety / DOT Regulations

Onboard diagnostics technology will be the next big thing because it’s affordable and very good at preventing problems, Ferrari says.

Mechanics can make or break a company. When it comes to DOT maintenance regulations, many companies fail engine hours because it’s easy to run a shuttle at low mileage but with longer engine hours.

Do pre-trip inspections before sending your buses out, even if not required by law.

For insurance, Covington says you should bid and get quotes from different providers to “keep honest insurance guys honest.”

Look at insurance losses once a month or at least every other month, not just at renewal time.

Bell has a risk management program that combines in-vehicle cameras with counselors who analyze chauffeur habits and work with the chauffeurs to help them improve.

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